The Pike River Coal mine is on the West Coast of New Zealand’s South Island. It is an underground mine targeting high value coking coal.
Background
A former subsidiary of NZOG, Pike River Coal Ltd (PRC) became a separately listed company on the NZX and ASX following a successful initial public offering (IPO) in July 2007. NZOG retained an interest as the largest shareholder.
In March 2008, PRC successfully completed a NZ$60m rights issue and a US$30m convertible bond issue to secure further funding for the mine development. NZOG underwrote its $17.5m share of the rights issue.
In April 2009, PRC successfully completed a NZ$45m rights issue and share placement to provide funds until steady state production from hydro monitor mining is achieved. NZOG partly underwrote the rights issue.
The seam of high quality coking coal was reached in October 2008. Production was then delayed by a partial collapse of a ventaliation shaft, and a rock graben encountered near the pit bottom.
The first shipment of coal was sent to India in February 2010.
On 24 February 2010 a new funding package was announced.
NZOG's interest in PRC
NZOG's current shareholding in PRC is 102,637,600 shares (29.5% of issued capital). NZOG also has 17,266,132 options (exercisable on or before 24 April 2011 for NZ$1.25 per share). NZOG has two directors on the seven-person Pike River board.
Further information on Pike River Coal Ltd is available from www.pike.co.nz
